Iraq, TotalEnergies Sign $27B Energy Deal
Iraq and French oil major TotalEnergies (TTEF.PA) on Monday signed a long-delayed $27 billion energy deal that aims increase oil production and boost the country's capacity to produce power with four oil, gas and renewables projects.
The deal had been signed in 2021, with an initial investment of $10 billion in southern Iraq over 25 years, but it was delayed amid disputes between Iraqi politicians over terms.
TotalEnergies Chairman and CEO Patrick Pouyanne signed the agreement with Iraqi oil minister Hayan Abdel-Ghani at a ceremony in Baghdad, with Pouyanne hailing it a "historic day".
The deal was closed in April, when Iraq agreed to take a smaller than initially demanded stake in the project of 30%, with TotalEnergies taking a 45% stake and QatarEnergy holding the remaining 25%.
The Gas Growth Integrated Project (GGIP) aims to improve the country's electricity supply, including by recovering flared gas on three oilfields to supply power plants.
Shell Follows Exxon, Warning Profits Are Falling Amid Oil and Gas Slump
Oil-and-gas giant Shell warned investors that profits fell in the second quarter, following rival Exxon’s statement earlier this week.
Extreme swings in European natural gas prices last year helped propel Shell’s profits to record levels, with trading in the unit accounting for as much as a quarter of overall profitability. The strong performance continued into this year, helping the company deliver its best-ever first quarter, but conditions were less advantageous in the following months.
Shares were slightly lower in early trading in London.
Earnings from the unit are “expected to be significantly lower compared to a strong first quarter due to seasonality and fewer optimization opportunities,” Shell said in a statement. The division’s performance returned to average levels seen in 2021 and 2022.
Oil, Gas Groups Question Legality of Proposed BLM Rule
Oil and gas industry interests are questioning the legality of a proposed Bureau of Land Management conservation and landscape health rule that according to its backers has generated tens of thousands of comments to the agency in support of it.
The public comment deadline for the proposal ended Wednesday, after being extended for an additional 15 days, and more than 150,000 comments have been submitted. The BLM says the rule, which it also refers to as its public-lands rule, would put conservation on an equal footing with other uses of the land it manages. It focuses on maintaining intact lands and identifying and evaluating lands for possible designation as areas of critical environmental concern, and proposes “conservation leasing” of lands for restoration or mitigation work. It says the rule protects valid existing rights and previously authorized uses.
Lease Sale Nets Nearly $15M, Gov. Gordon Stresses Need for More
The push to revive the oil and gas industry is on.
The BLM held the first oil and gas lease sale in more than a year and netted $14.7 million in Wyoming, approximately $1.8 million more than the 2022 sale.
Initially, over 250,000 acres were proposed. However, that number was reduced to just over 127,000 acres – a drastic reduction in available acres for leasing bids. 49 parcels did not receive any bids.
In prior years, many of these parcels could have been sold through the noncompetitive bid process, providing additional revenue for the state. Without this program, the state does not receive any income.
In a release from the Office of Governor Mark Gordon, the governor noted that federal law requires the BLM to hold quarterly oil and gas lease sales. Since January 2021, that schedule has yet to be followed.
In addition, this is the first sale conducted under new requirements, including an increased minimum bid, a nomination fee, an increased royalty rate of 16.67 percent and the elimination of noncompetitive leasing.
Congress amended the Mineral Leasing Act in 1987 and required the BLM to hold quarterly oil and gas lease sales in each state when lands are available for leasing. The BLM adhered to the law for over three decades until President Biden took office.
Under Governor Mark Gordon’s direction, the State challenged the Biden Administration’s new policy to deviate from this practice in court. That suit remains pending before the United States District Court for the District of Wyoming.
“While I am pleased that a sale has occurred, it comes with the recognition that this is not even a quarter of a loaf. Quarterly lease sales have not been held, and the additional costs to Wyoming oil and gas producers have a chilling effect on the ability of producers to bid,” said Governor Mark Gordon. “The fact that our producers participated to the degree they did is a credit to the Wyoming oil and gas industry. Their efforts mean Wyoming will continue to provide energy for the nation, even though they do so with increasing pressure from Washington, DC, to give up.”
The higher mandatory fees required by the Inflation Reduction Act mean higher fuel prices at the pump. Since Wyoming receives 48 percent of royalty rates, bonus bids and rental payments, the State will receive more revenue due to the increased federal fees, which comes at a cost to consumers and the oil and gas economy.
The Wyoming oil and gas industry has yet to regain the number of drilling rigs or employees it had in 2019. The number of drilling rigs for 2023 has hovered around 20, slightly more than half of the number in 2019.
On September 18, 2023 The Crude Life will host it’s Fourth Annual Podcast Party at the Energy Exposition being held in Jackson Hole, Wyoming. This year, three energy producing state governors will be joining us.
The Energy Exposition has educated tens of thousands of people in Gillette, Wyoming; Billings, Montana, and Loveland, Colorado, over the last 20 years on procedures, technology, safety, environmental practices, and equipment used in the oil and gas industry.
Exhibitors and Symposiasts represent a wide range of services, including but not limited to, exploration, production, downstream, and all phases of support to the oil and gas industry.
Energy Producing states Alaska Governor Mike Dunleavy, Oklahoma Governor Kevin Stitt and Wyoming Governor Mark Gordon will be attending this year’s expo and kick-off party.
To reserve Exhibit Space contact
Austin Jennings
239-898-3923
austin@energyexposition.com
Norway Approves More Than $18 Billion in Oil, Gas Investments
Norway's government said on Wednesday it has given approval for oil companies to develop 19 oil and gas fields with investments exceeding 200 billion Norwegian crowns ($18.51 billion), part of the country's strategy to extend production for decades to come.
Norway's parliament in 2020 introduced temporary tax incentives to encourage petroleum investment at a time of low activity, triggering a rush of applications from energy companies.
Among the field developments receiving final approval on Wednesday were nine operated by Aker BP (AKRBP.OL), three by Equinor (EQNR.OL) and several by Wintershall Dea and OMV (OMVV.VI).
"These are projects that will contribute to a continued high and stable output from Norway's continental shelf as well as employment and value creation," Minister of Petroleum and Energy Terje Aasland told a news conference.
The Earth’s Champion Johnny Green (taking pic) is Cleanin’ and Johnny Greenin’ across America engaging with All Walks of Life.
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The Crude Life Daily Radio News & Lifestyle Update
Jim Willis, founder of the Marcellus Drilling News, gives an update on the Shell Ethane Cracker plant in Beaver County, PA.
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Iraq and TotalEnergies Ink $27B Deal, Norway Invests $18B, WY Gov wants more Oil Leases and Exxon Says Oil Slump Coming